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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Steve who wrote (13751)	3/2/2000 5:49:00 PM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 21876

Lucent enterprise spinoff comes with a big asterisk Fast-growing VPN, firewall, and remote-access products remain with parent. By David Rohde Network World Fusion, 03/01/00 Lucent isn't sending 100% of its enterprise portfolio over to the new enterprise spinoff it announced Wednesday. And that could spell additional challenges for the new company as it tries to get its bearings in the enterprise data market. Lucent officials confirmed Wednesday afternoon that it is keeping for itself the enterprise-class products that were included when it acquired fast-growing data players Ascend and Xedia in 1999. Those products are primarily WAN edge devices, including Xedia's VPN router family, which is now called Lucent AccessPoint. They also include offshoots of Ascend's Pipeline remote-access family, including the SuperPipe family of multiservice access devices launched last year that are aimed directly at branch offices and telecommuters. Lucent is even going to keep some of its own homegrown WAN products aimed at VPN implementations, including a firewall appliance and the Security Management Server. All of these acquired and homegrown products are currently included in a group called the WAN Systems Group. Tellingly, the WAN Systems Group had been included in a recent reorganization at Lucent that created for the first time an Enterprise Networking Systems (ENS) business unit joining up voice and data products. Yet under the new plan, WAN Systems is not going over to the spinoff, even though it is designed as an enterprise networking play and includes PBX, call center, Ethernet, ATM and cabling product families. The decision to hold out this key group from the enterprise spinoff could further complicate the efforts of the spinoff's data side - primarily consisting of the Cajun campus Ethernet and ATM products -- to find an installed base it can successfully sell to. Of the $8 billion in revenue represented by the enterprise spinoff, the vast majority is PBX and call-center-related, says IDC analyst Esmeralda Silva. The LAN switching line contributed only $270 million for 1999. And that pairing hasn't borne many dividends, she says. "It's unfortunately still the case that having PBX expertise does not mean you're going to be able to sell LAN switching systems into the enterprise space," Silva said. She suggested that the Lucent spinoff may now try to reposition the Cajun line as ideal for e-commerce data centers - not only for enterprises but also for Web hosting providers and application service providers. The company could attempt alliances or acquisitions with others emphasizing e-commerce infrastructure. Peter Bernstein, president of Infonautics Consulting in Ramsey, N.J., said that the spinoff could also pursue new opportunities, such as acquisitions of customer relationship management (CRM) software firms. These are opportunities Lucent management hasn't pursued much recently, instead seizing big opportunities in optical networking for service providers. Lucent may also be keeping the VPN products simply because they're hot. Howie Gittleson, vice president of engineering for the WAN Systems Group, says the group's product lines are growing at a compound annual rate of 50%. The bulk of the spinoff's product lines - the PBX-related systems - are generally considered to be growing only in the high single digits or the teens. Gittleson also explained that VPN products generally straddle the line between enterprise and service provider, because service providers often want to deploy them on customer premises for managed enterprise services. networkworld.com

To: Steve who wrote (13751)	3/2/2000 7:07:00 PM
From: Mana	Read Replies (2) \| Respond to of 21876

Steve- Just got back from the "Town Meeting". There is a lot to digest. It was very, very positive. It was nice to put a face w/ the voice. Don does kind of looks like Bill Bradley. I like the fact that they plan to increase the R&D funding from the 4-5% that it is now w/ enterprise. They still don't have know what the stock ratio will be. However, he did say that he wants the stock to come out around 20-25. They will be selling the new company to the investment company very hard. He reminded us how Lucent looked like the step-child of AT&T at first and look at it now. I was very impressed with him. I think both companies will excel tremendously. I'm hopping on board. -chris